Using a food processor fitted with a coarse grating disk, grate the potatoes and onion; discard any large pieces. Transfer the mixture to a clean dish towel and squeeze out any excess liquid, then transfer to a large bowl. Stir in the flour, egg, 3/4 teaspoon salt, 1/4 teaspoon pepper and the baking powder.

In a large nonstick skillet, heat 1/4 inch of oil over medium-high heat until hot but not smoking. Working in batches, drop 2-tablespoon scoops of batter into the pan about 2 inches apart. Using a spatula, flatten the batter into disks. Cook, turning once, until browned and crisp, about 5 minutes. (Lower the heat if the latkes darken too quickly.) Drain on paper towels. Serve with cranberry sauce.